Friday, November 23, 2012

The State of Racing in New Jersey

So how are things in New Jersey when it comes to racing? Not well.

The NJTHA, in seeking to intervene in the lawsuit against the State of New Jersey regarding sports wagering, claims an injunction against the state with regards to sports wagering would "likely sound the death knell" for Monmouth Park and the state's thoroughbred breeding industry. According to John Brennan from The Record, the NJTHA strategy for keeping Monmouth Park open depends on the revenue from sports wagering. While this may be an overstatement, with the Governor being intransigent with regards to slots at the tracks, this appears to be the only significant revenue stream racetracks can tap into.

Meanwhile, on the standardbred front, with Perretti's defection from the New Jersey market, sending their stallions to Pennsylvania, you don't even need a full hand to count all the stallions standing in New Jersey. Why abandon the New Jersey market? As Perretti's Bob Marks states "Nobody can exist when nearly
half a great stallion's crop sells for $15,000 or less". Of course, when the NJSS finals are being contested for a mere $150,000 final with only two preliminary legs at the Meadowlands and the second tier finals are contested for a whopping $25,000 at Freehold, there is not much interest in yearlings if they don't come from top stallions and mares and have perfect conformation. Only those looking to race on the Grand Circuit are willing to pay top price; those interested in the local circuit would do better finding a good $7,500-$10,000 claimer to race at the Meadowlands.

Last year you couldn't even get ten horses to drop in the box for all the 2yo trotting finals at the Meadowlands. Unless things dramatically change by 2015, we will be seeing walkovers in the sires stakes, if they even exist. People used to talk about the big three jurisdictions of New Jersey, New York, and Ontario when it comes to sires stakes; now New Jersey may find itself grouped with Massachusetts and Virginia. Of course, if the state comes up with a way to make racing state sired horses profitable in New Jersey, the slide would level off and possibly reverse itself somewhat.

While the Governor has made it abundantly clear he is not in favor of putting slots at the racetracks (at least until the 2013 gubernatorial election has concluded) to help the racetracks, perhaps he could be persuaded to provide support for the sires stakes programs and a similar program for thoroughbreds for a relative pittance (in state budget terms) to stabilize the breeding industry in the state while the racetracks work on reviving their wagering business. The NJSS finals in 2012 went for $150,000 each. Would it be that much of a hardship for the state to increase the 2yo finals in 2015 by $100,000 each and 2yo and 3yo events in 2016 to help maintain interest in New Jersey stallions? For the Green Acres finals, the state could add $50,000 per division to ensure those races go for $75,000 each. This would result in an expense of $1.2 million per year starting in 2016. For argument purposes, let's say thoroughbred interests received the identical amount of funding for state bred stakes. This would be $2.4 million, a far cry from the $30 million the casino industry provided each year for purses before Christie was elected.

Of course, not every horse makes it to the sires stakes. What can be done to make purchasing a NJ-sired horse more attractive? Recently, Freehold Raceway and the SBOANJ agreed that 40% of all races would have a preference for NJOS stock. Assuming Freehold will be racing in January, while not give preference to NJOS horses in all races for the first three months of the meet when many tracks are closed to ensure local horses have more racing opportunities?

The point is some steps can be taken to help shore up or at least stem the decline of the breeding industry in New Jersey. It just takes some creativity.

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